Yesterday I received a phone call from a recruiter named Ben from an agency called Talent asking if I was interested in a digital communications role at Australia Post. It was a six month contract and I said yes I would be interested.
He explained that the pay rate was $450 per day inclusive of superannuation. That’s about $50 per hour plus super, which is consistent with what I have previously received in similar roles. He asked whether I have an ABN or wanted to be classified as a PAYG employee.
While I have an ABN and use it for the occasional freelance contract, I prefer to be a PAYG employee because this means that the employer does all the financial administration in relation to paying tax and super.
I replied that I wanted to be a PAYG employee. He explained that Australia Post charged employees a 2.5% administration fee to be classified as PAYG, and that Talent would pass that fee on to me, the employee, who would have to pay them back 2.5% of my income to retain the role. Ben told me that Australia Post was the only employer his agency dealt with who has such a policy.
I replied that this arrangement was unacceptable and I was not interested in working there. I questioned the legality of the fee but Ben had no comment on that. He seemed to have no agenda other than to fill the role. I had no reason to doubt that what he said was what he genuinely believed to be true.
I did some research online and Australian workplace law states that employers can only deduct a fee from employee wages with the consent of the employee and only for legitimate expenses, such as if an employer provides an employee with accommodation.
Afterwards I sought comment from the Fair Work Ombudsman via Twitter. I have written previously about being offered a contract that violates Australian workplace law, and the efforts I went to to get the Fair Work Ombudsman to do something about it.
I posted a summary of the situation on Australia Post’s Facebook asking ‘please explain?’ and got no response. I also emailed the media queries address at Australia Post seeking comment on the allegation that they charged an illegal fee to temp contract employees. I stated that my publication deadline was 12pm today. I received a written response via email at 11.45am stating that they do not charge any fees to contract workers.
Host employers like Australia Post use labour hire recruitment agencies to find them temporary staff. Employees are employed by the agency for a nominated rate and loaned to the host employer, who is charged an additional fee that covers recruitment and administration (payroll, including tax and super) and the agency’s required profit margin.
The contractual arrangement between the agency and the host employer is for them to determine. There is no need for the employee to be aware of the details. It makes no sense for an additional administration fee to be made visible to the employee or for the employee to be expected to pay it.
This made me suspicious about Talent. It sounds to me like I was lied to. Talent lied about Australia Post, presumably because the 2.5% administration fee goes to them, not the host employer. It sounds to me like they were trying to illegally screw money out of me in return for getting the job. In structure it is as simple and as unethical and unlawful as the 7-Eleven wage fraud, where employees were paid then made to return some of their income to their employer.
I’m an old school socialist. Workers unite. We can’t trust greedy unions and their corrupt corporate executives to look after our best interests. We have to do it ourselves. So I want to hear from fellow contractors, especially in Melbourne. Have you been asked to pay a fee to get a job? Did you question the legality of it?